Afternoon summary

• Philip Hammond, the defence secretary, has said he would expect Scotland to lose naval shipbuilding contracts if it votes for independence. He made the point in a BBC News interview where he was much more explicit about would happen in the event of a yes vote in the referendum than he was when asked about this in the Commons. He was speaking in general germs, but also referring to an order for Type 26 global combat ships. The Ministry of Defence is expected to order 13 of them from Glasgow, but the contract will not be finalised until after the referendum. This is what Hammond said when asked what would happen if the Scots voted to leave the UK.

The UK has always built complex warship in the United Kingdom so that it has sovereign control over the operation of those contracts. If we changed our position at some point in the future and decided that we wanted to compete contracts for complex warships in the open market, with countries outside the UK being able to bid, then that would open up the market to all sorts of competitors.What I have said, and I will say again today, is I see no reason to expect that the UK would want to change from the position that we will build complex warships in the UK for reasons of maintaining sovereign capability in the future.

• Nicola Sturgeon, Scotland's deputy first minister, has played down the suggestion that independence would lead to Govan losing naval contracts.

The Clyde's won these contracts because it's the best place to build the frigates. That won't change with independence.

She also insisted that Govan was viable without naval contracts.

Naval procurement will be part of that future but we need to do more to seek export work and diversify beyond naval orders alone. Other maritime countries, of similar size to Scotland, like Norway, support much bigger shipbuilding industries than Scotland.

• The Unite union described David Cameron's comments about possible legislation to stop direct action by unions as "an attack on freedom". (See 2.47pm.) A spokesman issued this statement.

Protest is about the freedom of expression. That is what David Cameron is threatening. Ordinary working people do not have the benefit of national newspapers or the floor of the Commons when it comes to expressing their views. Now it seems the Tories want to gag them.

All Unite organised protests have been lawful. None have breached the right of privacy. All have been conducted silently when at a place of residence.

No-one, least of all children, has been intimidated. Their purpose has been to ensure that the community knows how workers are being treated and that companies act within moral parameters.This is not an attack on Unite. It is an attack on freedom, from a government devoted to protecting the rich and powerful at the expense of everyone else.

• Cameron and the South Korean president Park Geun-hye have announced plans to double trade between the two countries by 2020.

Conversations with veteran industrialists about the state of shipbuilding today do not yield whimsical reminiscence of the good old days. Instead they produce regrets that tough commercial decisions – of the kind that saw France and Germany aggressively pursue markets such as nuclear power or premium cars – were not made in Britain in the 70s and 80s. Sir John Parker, the former chief executive of Harland and Wolff, the much-diminished Belfast shipbuilder, said the industry missed an opportunity in the Thatcher era.

"One of my big industrial disappointments or even failures is that I failed to persuade the government of the day that there was a big future in building cruise ships. Whoever used run-of-the-mill bulk carriers or tankers drifted to the lowest-cost country. So how you survived in higher-cost countries was more sophisticated ships like cruise ships. I saw that there was going to be a lot of growth in cruise ship building so we demonstrated that this was a real growth industry. And nearly 25 years on, those forecasts would have underestimated the demand." Thus the industry drifted to the east.

The reality is that British shipbuilding has been in trouble since shortly after the Second World War. Commercially we fell behind, even though globally this is a golden age of shipping when tens of thousands of vast container ships criss-cross the globe carrying goods between continents. The decline in shipbuilding here had its roots in poor management stretching back to the late 19th century, trade union obstinacy, and the rise after two world wars of foreign rivals who could produce much bigger ships more efficiently. Capital which might have been invested in the UK catching up went elsewhere, when quite sensibly those with said capital observed that it could get much higher returns if invested in sectors and other markets that did not have the problems inherent in British shipbuilding and heavy industry.

...2) what their plans would be in the wake of a yes vote in the Scottish referendum

As well as writing to BAE Systems, she could, of course, ask Philip Hammond, the defence secretary. She's his PPS. That explains why, despite being a local MP, she did not speak in the Commons when Hammond made his statement.

(Hammond was asked what would happen in the event of a yes vote in the Scottish referendum. See 2.47pm.)

Lunchtime summary

• BAE Systems has announced that it is cutting almost 1,800 jobs and calling an end to 500 years of shipbuilding in Portsmouth.The shipyard will close by the end of 2015, with heavy job losses there and in Scotland. The job cuts were announced by BAE Systems, but the decision was taken in consultation with the Ministry of Defence, and Philip Hammond, the defence secretary, gave details in a statement to the Commons. He said there was no longer enough defence work available to keep shipbuilding going in both Glasgow and Portsmouth and that it made sense to consolidate the work in one location. As part of the announcement, remaining aircraft carrier work will be completed in Glasgow, three new ocean-going patrol vessels are being built there (relatively cheaply, for less than £100m, because, under the terms of its contract with BAE Systems, the government was doing to otherwise have to pay for the shipbuilders to remain idle) and in future the planned 13 Type 26 frigates will be built there too. Hammond told MPs:

Consolidation of the ship-building industry is not a single event. It has been a process that's been going on for decades ... I'm afraid the logic of the size of the Royal Navy and the budget that we have for building new ships, the inexorable logical is that we can only support one naval shipbuilding location in the United Kingdom. Anything else, I'm afraid, is fantasy economics.

• Hammond has hinted that Glasgow could lose the Type 26 contract if Scotland votes for independence. When asked in the Commons if the order would go ahead if the Scots vote to leave the UK next September, he refused to give a direct answer. But he did stress that the final Type 26 contracts would not be agreed until after the referendum.

• A Conservative MP has complained about jobs in Portsmouth being "sacrificed" to protect the Scots. Caroline Dinenage, the MP for Gosport, made the claim on the World at One.

The fact that Scottish jobs have been protected at the expense of those on the south coast, which is an area of equal economic need, for us is devastating and very upsetting.

Mike Hancock, the MP for Portsmouth South, also claimed that the desire not to upset Scottish voters ahead of next years's referendum was a factor in the decision. (See 11.28am.) Asked about this, Hammond said the decision to end shipbuilding in Portsmouth was taken by BAE Systems.

• Vernon Coaker, the shadow defence secretary, has signalled that Labour will not oppose the decision. This is what he said in the Commons.

When the Government does the right thing on defence, especially where difficult decisions need to be taken, they will have the support of Labour. We always say and do what we believe is in the interests of Britain and its people. These are complicated and detailed matters and it will take some time to fully examine the consequences of today's announcements by BAE Systems and the government.

• David Cameron has said the government will consider acting to stop cases of industrial intimidation following claims the bosses of a petrochemicals plant in Scotland were intimidated by trade union activists. As the Press Association reports, at PMQs Cameron accused Labour of "ducking its responsibilities" by failing to order an investigation into claims Unite officials were involved in a campaign to intimidate the families of bosses at Ineos, which runs the petrochemicals plant at Grangemouth. He said he was shocked by allegations the children of executives had seen "wanted" posters put through their letter boxes, while their neighbours had been told they were "evil". The Tory MP Damian Collins asked him: "Do you agree with me that the authorities should always investigate allegations of harassment against employees and their families, including when they are allegedly involving members of the trade unions?" Cameron replied:

You are absolutely right - they are very serious these allegations of industrial intimidation. They need to be properly looked at. Because the party opposite is ducking its responsibilities, we will have to consider what we can do to look at this. I have to say that the leader of the Labour party is behaving like the mayor of a Sicilian town towards the mafia - 'they put me in and I don't want them to take me out' ...

We have seen 'wanted' posters put through children's letter boxes, we have seen families intimidated and we have seen people's neighbours being told that they are 'evil'. It is completely shocking what happened. It is also shocking that the Labour party is refusing to have a review and stand up to Len McCluskey and at this late stage they should do so.

Later a Labour source said:

The prime minister has got an MP involved in a cash-for-contacts scandal, he has got a chairman who the Metropolitan Police say may have committed fraud, he has got a transport minister using tax havens. What we have seen this week is a return to Tory sleaze. The prime minister should stop lecturing the Labour party and start cleaning up the Conservative party.

• Cameron has said he is "looking carefully" into claims that a Tory councillor wanted in connection with a murder in Pakistan was invited to a party at No 10. At PMQs Labour's Tom Blenkinsop asked:

Last month, Tory councillor Abdul Aziz was at an invite-only party in No 10. Councillor Aziz is subject to an arrest warrant in Pakistan in connection to a brutal murder. After shaking this man's hand and having photos taken at No 10 with this gentleman, would you now like to say that you think this gentleman should return to Pakistan and face justice?

Mr Cameron replied: "I am looking carefully into this case and I will write to you."

• Lawyers for David Miranda, the partner of a Guardian journalist held for nine hours at Heathrow under anti-terror laws, have urged High Court judges to rule that his detention was unlawful and breached his fundamental right to freedom of expression.There are more details on our NSA files live blog.

This week the GMB, the dominant union at BAE's Clyde shipyards and the third largest trade union in Scotland, announced it would support the no campaign in the referendum, provoking the ire of the nationalists but underscoring the political significance of this industry.

The decision to defend jobs in Scotland is no sop to Alex Salmond and his Scottish Nationalist government: confirmation that the Royal Navy's next-generation Type 26 frigate will be built on the Clyde is intended to be a challenge from the UK government to his plans for independence.

The defence secretary, Philip Hammond, recently said both yards would close – and contracts for the navy's next-generation Type 26 frigates would be lost – if Scotland voted for independence, since no UK government would pay a foreign shipyard to build its warships. In that scenario, warship-building would return to Portsmouth, perhaps with hundreds of Glaswegian shipbuilders heading south following that work.

Tobias Ellwood, a Conservative, asks for an assurance that the second aircraft carrier will be put into service.

Hammond says this decision will be taken in the defence review in 2015. But his personal view is clear. Having spent £3bn building it, he thinks spending £70m a year having it in service will be good value for money.

Sir Edward Leigh, a Conservative and a former chair of the public accounts committee, asks for an assurance that defence contracts will not in future be delayed in the way the carrier contract was delayed, with the result the cost went up.

Hammond says when the carrier project was finalised, the cost was set at £3.6bn. At one stage it had been £3.2bn. But he has not met anyone who thought it would come in for £3.6bn, he says. That was always a "fantasy" figure.

Labour's John Denham, the Southampton Itchen MP, says the last Labour government secured the future of shipbuilding on the south coast. This government has failed to win new orders for Portsmouth, he says.

Hammond says Labour did nothing to secure new global orders for the UK defence industry.

Labour's Ian Davidson asks Hammond to confirm that the order for the new ships will not actually be confirmed until after the Scottish referendum.

Hammond says the government will not finalise an order for ships that have not yet been designed. That was the mistake Labour made with the aircraft carriers, he says. That would amount to writing a blank cheque to the supplier.

He says Coaker will have to check his facts. Coaker said the carrier programme originally cost £3.2bn. But, almost as soon as it was announced, the Labour government announced a two-year delay, adding £1.6bn to the costs.

Hammond says unions have been engaged in trying to save the shipbuilding industry. He says the unions accept that the aircraft carrier contract led to a surge in jobs, and that this was not going to be sustained.

He says he would be more than happy to have a long conversation with Coaker about the £38bn black hole in the defence budget.

He says he cannot give Coaker a guarantee that the cost of the carriers project will rise. But now BAE Systems have an incentive to keep costs down.

Hammond turns to the government's wider warship building agreement with BAE Systems.

The government is still committed to a Type 26 combat ship. But construction will not start until 2016.

That leaves a gap in the shipyard construction programme. Under the terms of the government's agreement with BAE Systems, the government would have to pay the workers anyway. But their skills would diminish because they would not be working.

So the government has commissioned three new ships, she says. (See 11.35am.)

Hammond says the government would have had to pay the workers anyway. Because of this, the cost of the new boats is less than £100m.

Philip Hammond's statement on shipbuilding

Philip Hammond, the defence secretary, is making his statement now.

The last government agreed to build two aircraft carriers.

The coalition, when it came into power, was told it would cost more to cancel the contract than to go ahead with it. The public accounts committee said the contract was not fit for purpose. For every pound that the costs over-ran, the taxpayer would have to pay more than 90p.

Hammond says he has renegotiated the contract. The new value will be £6.2bn.

Any over-run will be shared 50:50 between operators and government until all the operators profits have been exhausted. This way, incentives are properly aligned.

The original contract was "lopsided" and "poorly-constructed", he says.

The governance of the contract has been changed too, he says. Sea trials are expected to start in 2017.

Overall, this renegotiation will save the taxpayer hundreds of millions of pounds.

Labour's Sharon Hodgson says the number of people unemployed in her constituency for more than two years has risen by 350%.

Cameron says the claimant count is coming down. The government must do more to grow the economy, he says. But it won't grow if the government borrows more. Labour is the biggest threat to the economy, he says.

Labour's Pat McFadden asks Cameron to admit that the Tpim regime was a mistake.

Cameron says he does not accept this. Under control orders, seven people absconded. The control order regime was being continually "hacked away" by the courts, he says. There has to be some regime for people who cannot be prosecuted. But the government will make it "as robust as possible".

The SNP's Angus Roberston points out that the shipyard job losses did not come up at all in Cameron's exchanges with Miliband.

Cameron says the government is announcing the building of three new warships on the Clyde. There will be job reduction, he says. But there are more jobs in ship servicing, he says. This government is building two new aircraft carriers, as well as destroyers and submarines.

Snap PMQs Verdict: Miliband had the edge, I felt, but he did not score a clear-cut victory, and the exchanges started with confusing statistic-swapping, and ended with sloganising. Not a classic encounter.

Miliband says Cameron is out of touch. He lists a series of health statistics going up. And it is because of his NHS reorganisation. How many NHS managers received a six-figure pay-off?

Cameron says there are 20,000 fewer managers in the NHS. But he quotes figures showing numbers of health staff are going up.

Miliband says Labour warned that care would be affected. Some 2,300 manages have received six-figure pay-offs, he says. So Cameron is giving P45s to nurses and six-figure pay-offs to managers. How many of those managers have been remployed?

Cameron says for the first time managers who are re-employed have to pay back money. And the reorganisation is saving £4.5bn. Miliband is too weak to stand up to poor health management in Labour's Wales.

Cameron says the government will do all it can. It has met its A&E target 27 weeks in a row. It is treating more than 1.2m patients in A&E. And there won't be a winter crisis in Wales - because there is an NHS crisis there already.

Miliband says Cameron is wrong. The government has missed its target on A&E for 15 consecutive weeks, he says. He notes that Cameron could not guarantee that there would not be a crisis.

Cameron repeats the 27 weeks in a row point. Now the average waiting time in A&E is 50 minutes. When Andy Burnham was in charge, it was 70 minutes, he says.

Steve Baker, a Conservative, says businessmen, decent trade unionists and papers like the Daily Mirror will have been appalled by the so-called Leverage tactics of Unite in the Grangemouth dispute. Will Cameron ensure families are protected from militants?

Cameron says this sort of intimidation is unacceptable. People's neighbours have been told they are evil. That is shocking. It is disgraceful that Ed Miliband will not order a review.

In the Commons a few minutes ago Alistair Carmichael, the Scottish secretary, was asked about the job losses in Scotland. "It was a day we always knew was coming," he said. But he promised to work with politicians from other parties, and with the Scottish government, to mitigate the effects of the job losses.

This is a very worrying time for the workforces and their families as the work on the two carriers comes to a conclusion. Unite will be working very hard to retain the maximum number of jobs at both Portsmouth and in Scotland. It is a huge blow to Britain's manufacturing and industrial base, with many highly skilled workers faced with losing their jobs.

We will have to examine the BAE business case in detail to see how we can secure a future for the workforces at both Portsmouth and in Scotland. We believe that, if this is approached in a constructive and innovative way, it can be achieved.

The seeds for this situation were sown in the 1980s when the Thatcher government used European structural funds to close shipyards, rather than funding investment that would have allowed Britain to compete in the global marketplace for shipbuilding orders against the likes of South Korea.

From Steve Murphy, general secretary of construction workers union Ucatt

Once again workers have found out that their jobs are under threat through the media. It is highly distressing and extremely unfair to treat a loyal workforce in such a way.

This is a highly skilled workforce, so it is absolutely essential that the government and BAE Systems minimises job losses, guarantees the long-term future of all the shipyards and continues to invest in training the workers of the future.

From Gerald Vernon-Jackson, leader of Portsmouth City Council

I condemn the decision to shut down the last remaining shipyard in England with the capability to build advanced surface warships. This decision is bad for Portsmouth, with the loss of many highly-skilled jobs, but it's also bad for the defence of the UK and for the Royal Navy.

The remaining yards with the capability to build advanced warships are in Scotland, and the referendum on Scottish independence is less than one year away. Ministers have put the defence of the UK and the future of the navy at real risk.

We will work as hard as we can to protect jobs in Portsmouth. Portsmouth remains the home of the Royal Navy, with more than 10,000 jobs remaining in the dockyard.

From Maureen Frost, executive director of Hampshire Chamber of Commerce

Losing the shipbuilding side is devastating news for the city. It's also about the supply chain and those small businesses that supply into BAE Systems so there's going to be a major impact.

The Ministry of Defence has now put out its own statement about the announcement. It ignores the job losses, and instead focuses on the new orders going to Glasgow and a plan to expand the naval base in Portsmouth.

The MoD plans to commission three new ocean-going Offshore Patrol Vessels for the Royal Navy in a deal that will sustain jobs in the UK’s warship building industry.

The new ships, which will be built by BAE Systems at their shipyards on the Clyde, will play a key role in counter-terrorism, counter-piracy and anti smuggling operations.

The agreement with BAE Systems provides work for the company between the completion of the Queen Elizabeth Class Aircraft Carriers and the Type 26 Global Combat Ship, securing the vital skills needed to build the UK’s future warships.

The Defence Secretary is also announcing today that more than £100 million will be invested in Her Majesty’s Naval Base Portsmouth, which will be home to both HMS Queen Elizabeth and HMS Prince of Wales. The money will expand the dockyard to ensure it is ready for the arrival of the Royal Navy’s biggest ever warships as well as the Type 45 destroyers which are based in Portsmouth.

Under the Terms of Business Agreement signed with BAE Systems in 2009 the MoD would have been liable to pay for any periods when no shipbuilding was taking place at UK yards.

Building Offshore Patrol Vessels means not only are staff at BAE Systems able to continue to work and maintain their skills, but the Royal Navy benefits from three new ships and the taxpayer gets much better value for money. The cost of building the ships is funded from money that would have been used to pay for idle capacity, finance redundancies and meet the cost of industrial restructuring.

Portsmouth will maintain its proud maritime heritage as the home of much of the Royal Navy’s surface fleet and the centre of BAE Systems ship support and maintenance business.

And here's the statement from Philip Hammond, the defence secretary.

This deal will provide the Royal Navy with three brand new maritime patrol vessels with a wide range of capabilities which will support our national interests and those of our OverseasTerritories.

This is an investment not only in three ships but in this country’s warship building industry. It prevents workers standing idle and sustains the vital skills needed to build the planned Type 26 frigate in the future.

I am also pleased to announce additional investment in Portsmouth Naval Base to prepare for the significant increase in tonnage as the home port for the Royal Navy’s aircraft carriers and destroyers.

Here is more from the interview Mike Hancock, the Portsmouth South MP, gave to BBC News earlier. (See 10.50am.)

• Hancock said he believed that the desire to minimise job losses in Scotland ahead of next year's independence referendum was a factor in the decision to concentrate job losses in Portsmouth.

The political side of it is undoubtedly this has to play for the Scottish referendum, and you have to be pretty kind to the government to believe this didn't play some part in it. I think Alex Salmond was in a no-lose situation. He would benefit if they closed the yard by saying they were being punished. If they keep the yards open, he will say they're being bribed. So from that point of view he's in a no-lose situation. But I think the people of Portsmouth will be paying a very heavy price for I think a slightly cynical manoeuvre. And I'm disappointed in that.

• He said he expected David Cameron and the Department for Business to make an announcement later today about developing maritime industry in Portsmouth.

• He said the he expected some of those who lost their jobs in the shipbuilding yards in Portsmouth to be able to transfer to BAE's ship-repair division at Portsmouth.

Portsmouth

The company has extensive high end naval engineering operations in the Portsmouth area. After the proposed reductions announced today, BAE Systems will still employ approximately 3,200 people across its sites at HM Naval Base Portsmouth, Portsdown Hill, Broad Oak, Cowes, and HMS Collingwood.

Portsmouth based engineers will be retained to support the design and development of the Type 26 frigate programme. The Company's Maritime Services business, based in Portsmouth, manages the running of HM Naval Base on behalf of the Ministry of Defence. The Queen Elizabeth Class carriers are expected to be based in the Portsmouth from 2017. The business also provides support services to the Royal Navy's Portsmouth flotilla, including the six Type 45 destroyers, which accounts for around 50% of the surface fleet.

Glasgow

BAE Systems operates two shipyards in Glasgow, Govan and Scotstoun, currently employing 3,200 people. These sites are supporting the manufacture of the Queen Elizabeth Class aircraft carriers and design of the Type 26 Global Combat Ship

Type 26 Global Combat Ship

The assessment phase for the Type 26 programme started in March 2010. A combined Ministry of Defence and BAE Systems team of approximately 550 engineers in Bristol, Glasgow and Portsmouth are currently working to develop the detailed specification for the vessel, with a manufacturing contract expected to be awarded at the end of 2014.

BAE Systems shipyard job losses announcement - Full text

Here's the full statement from BAE Systems. I've highlighted the key paragraph in bold.

BAE Systems has reached agreement in principle with HM Government on measures to enable the implementation of a restructuring of its UK naval ships business.

The agreement will result in:

· Restructuring of the contract for the Queen Elizabeth Class Aircraft Carrier programme.

· Provision of additional shipbuilding work prior to the start of the Type 26 Global Combat Ships programme.

· Rationalisation of the UK naval ship business to match future capacity requirements.

In 2009, BAE Systems entered into a Terms of Business Agreement (ToBA) with the Ministry of Defence that provided an overarching framework for significant naval shipbuilding efficiency improvements in exchange for commitments to fund rationalisation and sustainment of capability in the sector. The agreements announced today, together with an anticipated contract for the design and manufacture of the Type 26 Global Combat Ships programme, will progressively replace that ToBA.

Queen Elizabeth Class Aircraft Carrier

BAE Systems, with the other participants in the Aircraft Carrier Alliance, has agreed change to the Queen Elizabeth Class Aircraft Carrier contract. Under the revised terms, the contract will be amended to accommodate programme changes and activities previously excluded from the contract.

Under the new Target Cost contract the industrial participants' fee will move to a 50:50 risk share arrangement providing greater cost performance incentives. The maximum risk to the industrial participants will continue to be limited to the loss of their profit opportunity.

The revised contract reflects the increased maturity of the programme, with structural assembly of the first of class vessel now substantially complete.

Interim shipbuilding workload

A significant reduction in workload will follow the peak of activity on the Aircraft Carrier programme, the six Type 45 destroyers and two export contracts. The anticipated Type 26 programme will, in future years, address some of that workload reduction. In the interim period, a proposed contract for the manufacture of three Offshore Patrol Vessels, announced today, will provide additional capability for the Royal Navy and sustain key shipbuilding skills.

Restructuring of the Naval Shipbuilding business

Following detailed discussions about how best to sustain the long-term capability to deliver complex warships, BAE Systems has agreed with the UK Ministry of Defence that Glasgow would be the most effective location for the manufacture of the future Type 26 ships. Consequently, and subject to consultation with trade union representatives, the Company proposes to consolidate its shipbuilding operations in Glasgow with investments in facilities to create a world-class capability, positioning it to deliver an affordable Type 26 programme for the Royal Navy.

Under these proposals, shipbuilding operations at Portsmouth will cease in the second half of 2014. Subject to consultation, Lower Block 05 and Upper Blocks 07 and 14 of the second Queen Elizabeth Class Aircraft Carrier will be allocated to Glasgow.

The Company remains committed to continued investment in the Portsmouth area as the centre of its Maritime Services and high-end naval equipment and combat systems business.

Consultation will commence on a total employee reduction of 1,775 that is expected to result from these restructuring proposals, including 940 in Portsmouth in 2014 and 835 across Filton, Glasgow and Rosyth, progressively through to 2016.

The cost of the restructuring will be borne by the Ministry of Defence.

The implementation of these restructuring activities will sustain BAE Systems' capability to deliver complex warships for the Royal Navy and secure the employment of thousands of highly skilled employees across the UK.

Mike Hancock, the MP for Portsmouth South, has just told BBC News that he understands that around 500 core jobs will go at Portsmouth and a similar number of agency jobs. Many of them will "fairly quickly", he said.

He also claimed that the desire to save jobs in Scotland ahead of next year's independence referendum was a factor. It was a "slightly cynical manoeuvre", he said.

Vernon Coaker, the shadow defence secretary, told BBC News just now that he would be asking Philip Hammond, the defence secretary, what would happen to the Royal Navy shipbuilding contracts going to Glasgow in the event of Scotland voting for independent. Asked about Ian Davidson's proposal for a break clause in the contract (see 10.26am) , Coaker said he did not know whether this was feasible. But he said Davidson was raising an important point.

The really important thing for us is to ensure that this country has the capability, the capacity, to build the warships that it needs. We have some of the most skilled workers in the world in this country with respect to building those warships. You can't just turn those skills on and off. So we have to ensure that we have the capacity in those yards to keep those workers in work and to ensure that we can build the ships that we need.

On STV last night Ian Davidson, the Labour MP for Glasgow South West, said that the government should continue to order ships from the yards in Scotland, but that there should be a break clause in the contract allowing the contract to be cancelled if Scotland votes for independence. Here's the video. And here's the key quote.

I know that there's been a lot of pressure from both the government and the MoD to delay placing an order for the Type 26 [with Glasgow] because of the uncertainty caused by the referendum. Quite clearly, the British government has said specifically on a number of occasions that it will not place an order for warships in what would be a foreign country. What I've argued is that they should go ahead now, place the order, and if necessary have a claw-back clause in order that if, in the unlikely event that we vote for separation, they can take the work back in-house.

Johann Lamont, the Scottish Labour leader, has been speaking to BBC News about the job losses. She is an MSP for a Glasgow constituency, but she implied that she did not want to see the story just in terms of Scotland v England.

The first thing I would say, whether it is Portsmouth or the Clyde, we know these shipworkers are a very talented, very gifted, skilled workforce, and we have a solidarity right across the United Kingdom. We are sharing the concern now, the uncertainty. These are the people that need to be the focus of our considerations and deliberations at this time.

I am told that the announcement has been brought forward to this morning due to leaks in the media.

Everyone expects it to be curtains for shipbuilding. Some wonder whether BAE may also lose some of the maintenance contract for the surface fleet, perhaps to Babcock.

It has become clear that while BAE is keen to work on low-risk ventures like the Type 26 it sees ship services, not ship building, as its future and so it is natural for them to rationalise facilities.

The only good news could be an impending city deal worth at least £100m to help widen the marine industry in Portsmouth, with Rolls Royce Marine, Qinetiq maybe involved. Perhaps private refit work could provide some income at Basin 3 ...

Considerations of the vote on Scottish independence seem to have trumped the hi-tech yard run by BAE in Portsmouth. The move of Vosper Thornycroft from Southampton to Portsmouth meant the kit was amongst the best in the world. But the Clyde carries more weight at the moment.

Henley also points out that Penny Mordaunt, the Conservative MP for Portsmouth North, is parliamentary private secretary to the defence secretary, Philip Hammond.

More than 1,000 jobs are set to be axed at some of the UK's leading shipyards as defence work is reduced. Unions are braced for an announcement at 11am, including a decision not to build any new warships at the historic Portsmouth yard.

BAE Systems is expected to reveal the scale of job losses in Portsmouth and its other two yards at Govan and Scotstoun in Scotland.

It is understood that repair and maintenance facilities will be upgraded at Portsmouth, mitigating the effect on jobs.

New Type 26 warships will be built in Scotland, it is understood.

Politicians in Portsmouth have expressed alarm at the expected cuts, as well as the impact on firms which service the yard.

The announcement on job cuts at BAE's shipbuilding yards on the Clyde and the south coast of England is now expected to be made on Wednesday morning.

It is understood shipbuilding at Portsmouth will stop.

The company may cut more than 1,000 jobs in total between Portsmouth and the Govan and Scotstoun yards in Glasgow.

It is thought Govan will not close. An announcement had originally been due on Thursday.

Job losses on this scale normally have political consequences, as well as, of course, the real, immediate impact on the workers involved and their families. But in this case the Scottish independence referendum, and the desire to minimise the impact on Glasgow, has reportedly been a factor, and that may will trigger some kind of backlash. For an early flavour of that, see this from the Daily Mail's Tim Shipman.

As usual, I’ll also be covering all the breaking political news as well as looking at the papers and bringing you the best politics from the web. I’ll post a lunchtime summary after the Hammond statement and another after the home affairs committee hearing.